1.1 In these Terms of Business, the following terms shall have the following meanings:

“Agency Materials” means all original Materials created by Shift employees and directors for the Client as set out in a Scope of Work which are approved by the Client and incorporated into Deliverables, excluding any Branded Materials and Third Party Materials;

“Agreement” means these Terms of Business and any Scope of Work which is signed by both parties;

“Branded Materials” means tangible products created using design work or ideas originating from Shift (which may or may not contain the Client’s branding) and which may generate income through the sale, license or other exploitation of such products, including by way of example branded merchandise and/or character merchandise using cartoon figures, models or characters whose visual appearance has been created by or on behalf of Shift in connection with the Services;

“Deliverables” means the tangible deliverables to be delivered as set out in the Scope of Work;

“Business Day” means any day which is not a Saturday, Sunday or public holiday (in the UK);

“Client” means the client named in the Scope of Work;

“Client Materials” means information and Materials (including, without limitation, products and samples) provided by or on behalf of Client to Shift in connection with the Services, and includes any trade or services marks, trading names and branding of Client;

“Fees” means the fees payable to Shift by Client for the provision of Services as set out in the Scope of Work;

“Force Majeure Event” means any event, circumstance or occurrence beyond an affected party’s reasonable control including without limitation: (i) civil commotion, riot, invasion, war (whether declared or not) or threat of war, terrorism or threat of or suspected terrorism; (ii) fire, explosion, storm, flood, earthquake, subsidence, epidemic or other natural disaster; (iii) strikes, lock-outs or other industrial action (except of affected party), and (iv) impossibility of the use of the railways, shipping, aircraft, motor transport or other means of public or private transport;

“Initial Term” means the initial term during which the parties may not terminate this Agreement (subject to earlier termination in accordance with clause 10) as specified in the Scope of Work;

“Intellectual Property Rights” means any copyright, design right, patent, trade mark, database right or any similar right exercisable in any part of the world for the full duration thereof, including any application for registration of any patent, trade mark or design right;

“Notice Period” means the notice period for termination of this Agreement, as specified in the Scope of Work;

“Project” means a project agreed between the parties from time to time under which Shift is to perform Services and supply the Deliverables to Client, as more fully described in the relevant Scope of Work;

“Project Notice Period” means the notice period for cancellation of a Project set out in the relevant Scope of Work;

“Scope of Work” means a written scope of work agreed and signed by both parties which sets out (amongst other things) the Services and Deliverables to be provided and the Fees payable in respect of the Project;

“Shift” means Shift SDD Limited, a company incorporated in England and Wales with company number 07764948 whose registered office is at The Old Coach House, Rear of Eastville Terrace, Ripon Road, Harrogate, North Yorkshire, HG1 3HJ;

“Services” means the services to be provided by Shift in respect of a Project and which are set out in the Scope of Work;

“Third Party Materials” means any Materials which are commissioned and/or licensed by Shift from third parties in connection with the Project

1.2 In the event of a conflict between these Terms of Business and any Scope of Work, the provisions of the Scope of Work shall take precedence.

2 APPOINTMENT

2.1 This Agreement commences on the date of signature of the first Scope of Work and shall continue for the Initial Term, subject to earlier termination in accordance with 10. After the Initial Term, either party may terminate this Agreement by serving the other party with the Notice Period, provided that the Agreement and all Scopes of Work shall continue during the Notice Period, and such notice shall not expire prior to the end of the Initial Term.

2.2 Shift shall be entitled to subcontract the Services to third parties from time to time provided that it shall remain responsible for the acts or omissions of such sub-contractors. Where Client specifies that Shift must use a particular sub-contractor known to Client, Client acknowledges that Shift shall have no liability in respect of that sub-contractor

2.3 Shift agrees that the Services will be performed with reasonable skill, care and diligence.

3 Amendments and Cancellations

3.1 In the event that either party wishes to make any material amendment to a Scope of Work, any such amendment shall be subject to the agreement of both parties in writing.

3.2 In the event of any amendment to a Scope of Work by the Client, the Fees payable to Shift in respect of the amended Services shall not decrease below the level of Fees that would have been payable had the Services not been amended.

3.3 The Client may request Shift to cancel any Project or part thereof, and Shift will take all reasonable steps to comply with any such request provided that Shift is able to do so within its contractual obligations to suppliers. For the avoidance of doubt any cancellation or termination of the Scope of Work shall be subject to the Client giving notice to Shift, and such notice shall be not less than the Notice Period. Cancellation or termination of a particular Scope of Work in accordance with the terms of this Agreement shall not serve to terminate this Agreement which shall continue in full force and effect for any remaining Scopes of Work.

3.4 In the event of any such cancellation of a Project the Client will reimburse Shift for all Fees up to the date of cancellation, together with any third party charges or other expenses or costs incurred by Shift or to which Shift is committed as well as any charges or other expenses or costs imposed on Shift by third parties arising from the cancellation provided that Shift shall use reasonable endeavours to mitigate any such third party charges or expenses wherever possible.

3.5 In addition to the above, in the event of cancellation of a Project or part thereof, including any and all plans or work in progress by the Client the Client shall pay Shift’s Fees for the length of the Project Notice Period (notwithstanding the fact that the Services have been cancelled and may not have been performed). The calculation of Fees payable for the Project Notice Period shall be based on the scheduled monthly Fees which would have become due during the Project Notice Period (and which shall be payable notwithstanding the fact that the Agency may not have provided Services during the Project Notice Period.

4 CLIENT OBLIGATIONS

4.1 Client shall co-operate with and provide all reasonable assistance to Shift in order to assist in the smooth delivery of the Services, including without limitation, through the prompt provision of the Client Materials, and all information, instructions, training, approvals, authorities and materials reasonably required to deliver the Services.

4.2 Where approvals are required in relation to the Deliverables, the Client shall not unreasonably withhold or delay giving any such approval sought by Shift. If Shift does not receive a response to a request for approval within three Business Days (or such shorter period reasonably required by Shift), Client’s approval will be deemed given.

4.3 Prior to using any Deliverables (or instructing anyone else, including Shift, to do the same), Client shall be solely responsible for conducting all searches and investigations (including without limitation in respect of trade mark, slogan and patents searches), and taking all such legal advice, as may be necessary to ensure that proposed use of such Deliverables complies with all laws, regulations and codes of practice applicable in any territory in which the Deliverables are to be used, published or disseminated. Furthermore, if Shift invents any slogan, jingle, brand name, logo, design or domain name or similar for Client, as part of the Services, Client will be solely responsible for ensuring that the same can be freely and lawfully used, without incurring any liability for infringement of any third party rights or any applicable laws.

5 INVOICING AND TERMS OF PAYMENT

5.1 Shift shall invoice Client for the Fees in accordance with any payment timetable set out in the Scope of Work. All amounts payable are exclusive of Value Added Tax, and any other applicable sales taxes and import duties etc.

5.2 Where subcontractors require payment in advance or on faster payment terms than the payment terms set out in this Agreement, Shift will present such invoices to Client and Client shall pay the same immediately. For the avoidance of doubt, Shift will not advance such amounts on behalf of Client or accept any liability for the consequences of any late payments, including where they impact on delivery of the Services.

5.3 Subject to clause 5.2, all invoices issued under or in connection with the Agreement must be paid within 28 days of the invoice date unless specified otherwise in the Agreement. Time for payment shall be of the essence and Client shall make all payments due under the Agreement without any deduction whether by way of set-off, counterclaim, discount, abatement or otherwise.

5.4 Shift reserves the right to charge interest on all overdue amounts from the due date of payment to the date of receipt by Shift at the rate of 4% over the base rate of HSBC plc.

5.5 Without prejudice to any other right or remedy available to it, if the payment of any amount payable to Shift is not paid by the due date, Shift shall be entitled to suspend (in whole or in part) the provision of Services until the relevant amount has been paid in full (together with any applicable interest).

5.6 If changes to the Scope of Work (or otherwise of the Services and/or Deliverables) are agreed between the parties from time to time at their discretion, Client shall pay any consequential additional Fees.

5.7 Shift shall not be liable for, and shall be entitled to invoice Client for any additional Fees incurred due to any delay in provision of the Services where such delay is a result of Client’s acts or omissions.

6 INTELLECTUAL PROPERTY

6.1 Subject to Shift receiving payment of all Fees, Shift hereby assigns all Intellectual Property Rights in the Agency Materials which are capable of assignment to the Client.

6.2 Shift shall obtain such usage rights in respect of the Third Party Material as shall be necessary in order to use the Deliverables for the purposes set out in the Scope of Work Client hereby indemnifies, and keeps indemnified, Shift against any loss, liability, cost, damage, claim or expense suffered by Shift arising from any use by Client (or its group companies, suppliers or representatives) of Third Party Materials outside of the usage rights which have been notified by Shift to Client.

6.3 The parties agree that Branded Materials, are excluded from the assignment set out in this clause and that any use of the Branded Materials shall be subject to the parties agreeing additional terms, including agreement as to royalties and revenue shares between the parties arising out of use of such Branded Materials. By way of example, Branded Materials which are excluded from the assignment include merchandise and other goods in respect of which income can be generated. For the avoidance of doubt any printed POS, company brochure, retail environment, leaflet or packaging Materials which form part of the Agency Materials are included in the assignment of Intellectual Property Rights set out in clause 6.1, provided that such Materials are not capable of income generation through their exploitation

6.4 Client hereby grants to Shift the right to use and incorporate the Client Materials in the Deliverables and to use the Client Materials as required in order to provide the Services. Client agrees that Shift may use the Deliverables for Shift’s own PR, publicity and show reel purposes in any and all media.

7 LIABILITY

7.1 Nothing in the Agreement shall exclude or limit any party’s liability for fraud, or for death or personal injury resulting from its negligence, or any other liability to the extent that such liability may not be excluded or limited as a matter of law.

7.2 Subject to Clause 7.1, neither Shift nor any of its officers, employees, sub contractors or agents shall in any circumstances whatsoever be liable to Client for: loss of actual or anticipated income or profits; loss of contracts; loss of goodwill or reputation; loss of anticipated savings; loss of data; or any special, indirect or consequential losses or damage of any kind howsoever arising and whether caused by tort (including negligence) breach of contract or otherwise, whether or not such loss or damage is forseeable, foreseen or known.

7.3 Shift’s maximum aggregate liability under or in connection with the Agreement, whether in contract, tort (including negligence or otherwise) will in no circumstances exceed the level of Fees paid and received by Shift in the preceding 12 month period at the date such claim or action arises.

7.4 These Terms of Business set out the full extent of Shift’s obligations and liabilities to Client in respect of the performance of the Services and delivery of the Deliverables under this Agreement. The parties agree that any condition, warranty, representation or other term concerning the Services which might otherwise be implied into or incorporated into the Agreement, whether by statute, common law or otherwise, is excluded to the maximum extent permitted by law.

8 FORCE MAJEURE

8.1 Neither party will be liable to the other for any delay in performing or for failure to perform its obligations under the Agreement to the extent that and for so long as the delay or failure results from a Force Majeure Event, provided that:

(a) the Force Majeure Event arises without the fault or negligence of the affected party;
(b) the affected party notifies the other party as soon as is reasonably practical;
(c) the affected party takes all reasonable steps to minimise the adverse effects of the Force Majeure Event; and
(d) if the Force Majeure Event continues for a period of 30 days or more, the non-affected party may by written notice to the effected party immediately terminate the Agreement.

9 CONFIDENTIALITY

9.1 Each party undertakes to the other that it will not disclose to any unauthorised party any confidential information relating to the other party or its business (except as necessary in order to provide the Services) and neither will it make unauthorised use itself of any such information.

9.2 This restriction will not apply to any information which becomes publicly available otherwise than through the breach of this restriction by the receiving party.

9.3 It will not constitute a breach of this clause 9 if a party discloses the other party’s confidential information to the extent that such disclosure is required by law; or the information was lawfully in the possession of the receiving party prior to its disclosure by the disclosing party and had not been obtained by the receiving party from another party in breach of confidentiality obligations.

10 TERMINATION

10.1 Either party will be entitled to terminate the Agreement immediately by written notice if:

(a) the other party fails to remedy a material breach of the Agreement (where the breach is capable of remedy) within 30 days of a written notice specifying the breach and requiring its remedy; or
(b) the other party commits a material breach of the Agreement which is incapable of remedy; or
(c) the other party ceases permanently to trade; or
(d) the other party makes any voluntary arrangement with its creditors, or passes a resolution to wind up or goes into liquidation (otherwise than for amalgamation or reconstruction) or has a winding up order made against it, or an administrator or receiver is appointed in respect of the whole or any part of its assets, or it makes or offers to make any arrangement or composition for the benefits of creditors generally, or such other analogous event takes place in respect of that party.

10.2 In the event of the Agreement being terminated for any reason Client shall immediately pay to Shift all sums due and payable under the Agreement including all Fees and Operational Costs due up to the date of termination.

10.3 Termination of the Agreement will not affect the accrued rights and remedies of each party.

10.4 The following clauses of these Terms of Business shall continue to apply after termination of the Agreement: 5, 7, 9, 10, 11, and 12.

11 NOTICES

11.1 Unless otherwise stated in the Agreement, all notices and other communication under the Agreement shall be in writing and shall be deemed duly served if delivered by hand, or sent by e-mail, or pre-paid registered post (or, in the case of an address for service outside the United Kingdom, by registered air-mail) to Client at the address set out in the Agreement or to Shift at the address set out above or such other address as either party may notify to the other for this purpose from time to time. Any notice shall be deemed to have been duly served:

(a) if delivered by hand, on delivery;
(b) if sent by pre-paid registered post, two Business Days after posting; or
(c) if sent by registered air-mail, five Business Days after posting.

11.2 A notice given under this Agreement is not valid if sent by e-mail or fax.

12 GENERAL

12.1 During the term of this Agreement and for a further period of 12 months after its termination, neither party shall (except with the prior written approval of the other party) directly or indirectly solicit or entice away (or attempt to solicit or entice away) from the employment of the other party any person employed or engaged by such other party either in the provision or receipt of any Services or Deliverables, other than by means of a national advertising campaign open to all comers and not specifically targeted at any of the staff of the other party.

12.2 These Terms of Business, and the documents referred to in them, constitutes the entire agreement and understanding of the parties and supersedes any previous agreement, understanding or arrangement between the parties relating to the subject matter of the Agreement. The parties warrant and represent that neither of them has been induced to enter into the Agreement in reliance upon any warranty, representation, statement, agreement or undertaking of any kind (whether negligently or innocently made) of the other party or of any third party other than as expressly set out in the Agreement.

12.3 Client shall not assign to any third party the benefit or burden of any provision of the Agreement.

12.4 If any term (or part thereof) of the Agreement is found to be illegal, invalid or unenforceable by any competent authority, such term (or part thereof) shall, to the extent that it is severable, be deemed omitted from the Agreement and shall in no way affect the legality, validity or enforceability of the remaining terms.

12.5 Any person who is not a party to the Agreement shall have no rights under the Contracts (Rights of Third Parties) Act 1999 (as from time to time in force) to enforce any term of the Agreement.

12.6 The validity, construction and performance of the Agreement shall be governed by the laws of England and Wales and the parties hereby irrevocably submit to the exclusive jurisdiction of the courts of England and Wales for the resolution of any claim or matter arising out of or in connection with the Agreement.